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"Figure 4 (fig. 1 here) is a schematic diagram showing many copying services, and many publishers, related by a copyright clearinghouse. The CHC acts as a switching device, passing rights to make copies to all CS subscribers in the CHC system, and passing royalties to all subscribing publishers in the system. In both cases participation is voluntary, and regulated by some standard contract. The payments by the set of CS exceed the payments to the set of publishers by some agreed amount, which amount maintains the switching action. The result is pre sumably an increase in numbers of copies and increased communication in science, education, and other fields; and an increase in revenue of publishers. Since the revenue is largely (but not exclusively) in addition to what the publishers receive for their publications, it is presumably a means of increasing both communication among users of the publications and revenue to publishers of the publications. Properly designed, the CHC should act as a switch which supports science by increasing the volume of communication and which supports science by increasing the return on the intellectual property which the messages represent. The feasibility study is to determine how such a switching system, now lacking in our national economy, can operate lawfully under the copyright statute, and function economically, rapidly, and effectively."

There are a large number of details which are at present under investigation. The proposed contracts would grant immunity from infringement suit, and permission to make unlimited multiples of copies or uses, in return for royalties. The royalty rates would be carefully adjusted. They should be low enough so as to not constitute a burden on communication. Perhaps they should not exceed more than 10 percent of the cost per copy. They should be high enough so that the publishers and owners whom they represent would derive real revenue from this form of publication or use; and so that the CHC could maintain itself with a small fee. So far these problems do not appear insurmountable. The most difficult single problem in the CHC system is the determination of a sampling system which will be fair to all publishers, big or little, and not so expensive to use that it will take a large fraction of the collected royalties. At present the CICP is raising funds for a design study of this sampling system. The CICP Systems Committee has also studied a simple stamp system for individual copiers, which might be run by the CHC.

This method of solving the copyright duplicating problem has many virtues. The chief are: (1) it maintains the copyright principle and sustains that part of the creativity cycle which depends upon copyright; (2) it offers an economic switching device-a means for copiers to pay a modest fee for the privilege of copying, and enables them to copy by means of the new techniques ; i.e., easily, cheaply, rapidly, and lawfully in unlimited amounts; (3) its existence would make unnecessary the appeal to disputed legal principles such as "fair use" in photocopying, and the even more doubtful equating of fair use with the making of single copies; (4) it is readily extendable to other media than graphic; (5) it is based on voluntary adherence to contract, rather than on legal recourse. On the other hand, since the operation will be under the copyright statute, the CHC in no way reduces legal recourse in such cases as are necessary.

There is little to be said against this solution. Possibly the worst is that it depends upon the voluntary cooperation of publishers and copiers. A voluntary system, say the “hardheaded,” will never work. “There will be too many exceptions." One answer to that is that, in the first place, the present copyright statute is also primarily designed for voluntary contract between user and copyright owner. The thing which has broken down is not the voluntary nature of the contract, but the capability to make the contract rapidly, so as to permit the user to copy on short notice with his modern means of doing so. The legal recourse against infringement should not obscure the fact that each individual contract between user and copyright owner was and is voluntarily entered upon. What the new CHC would do is to make it feasible to pay a large number of very small royalty payments, rapidly and easily.

Again it is said that the CHC will be too expensive to operate and so cannot be self-sustaining. There may indeed be a fairly high cost for setting up the system. But once in existence there is evidence that it will pay for itself, perhaps easily. As to initial costs of setting the system up, there are many enlightened persons and corporations who may make it their business to see that such an institution is not only set up but does not fail for want of pump priming, once they are satisfied of its objectives. In any case it may seem cheap in the long run if the alternative is a decline in the creativity-productivity cycle. Like democracy, it may be inefficient and uneconomical, but still the best solution.

In closing I would like to add that the CICP is not committed to this solution, although it is associated with their name. In fact, the CICP welcomes suggestions, including other ways to solve the main problem: to bring together the producer of the copyrighted works, and the consumer. So, I conclude as I began: we must hang together, or assuredly, we shall all hang separately. We must renounce our parochial views on copyright if we are to preserve its constitutional function as a means of promoting the sciences and the arts; i.e., creativity.

RECOMMENDATIONS FOR LEGISLATION The following recommendations are based on opinions as to future conditions, as contrasted with present conditions, i.e., on estimates of the probable evolution of copying and dissemination of copyrighted works within the next quarter century. The CICP recommends that

1. The payment of moderate fees or royalties be recognized by the Congress as a budget cost in research, development, education, and other productive uses of copyrighted materials; this cost being recognized in order to maintain a free enterprise system in which the copyright principle has become essential to the advance of science and the arts.

2. In revising the copyright statute the Congress introduce no measure which would prolong or aggravate the present short-term technical and economic advantage (as described in the preceding statement) of the consumer of copyrighted works over the producer; nor which might hinder the normal economic readjustment of this advantage that might be brought about, for example, by establishment of a more effective and rapid means for the consumer to obtain permission to make any number of copies of copyrighted works, and to make prompt payment for same.

3. As an alternative to legislation within the copyright statute to correct the economic advantage of the copyright consumer over the producer, the Congress consider chartering a nonprofit utility or semiprivate corporation, a copyright clearinghouse, to be operated jointly by representatives of both consumers and producers of copyrighted works, for the purpose of enabling rapid, inexpensive, and convenient economic exchange of moderate fees or royalties for rights to copy or to make other uses of copyrighted materials.

Mr. TENZER. Before the professor starts, may I say that Mr. Edwards and I are on the call of the chairman of the Judiciary Committee on Voter Rights Legislation. If we leave during the course of your testimony you will understand, but be assured that I will read your testimony thoroughly.

Mr. MEYERHOFF. I understand but I thought I would have the pleasure and privilege of some of the pertinent questions you ask.

Mr. TENZER. Thank you, sir. I will stay just as long as I can. . Mr. KASTENMEIER. Proceed, sir.

Mr. MEYERHOFF. The Committee To Investigate Copyright Problems is a voluntary group which started as a very informal committee in 1958 and ultimately became incorporated in the District of Columbia. Its function has been to group together the various interests in the copyright problem. We recognize that they extend all the way from author to user, and that in between is the publisher, and others.

There is now, of course, a very large group of manufacturers of equipment and supplies, who provide the tools that reproduce the material that is presented by authors.

Initially our primary interest was in science and in engineering. At the present time in our economy and in our defense we are dependent upon the rapid and almost immediate flow of new scientific discoveries into application on the part of engineers. And of course another field of application which is of the utmost importance is the field of education.

Therefore, our concern is primarily with the various kinds of publications which range all the way from books to articles in technical periodicals, those that are purely scientific to those which are applied in the fields of engineering and related areas.

So this broadens the concept which Mrs. Linden gave you, in which the concern was principally with the textbook and the educational usage thereof.

It quickly became apparent to us, with the explosion of technical devices in the reproduction of materials, that although a problem did not necessarily exist at the time, at least in the legal sense, it is only a question of time before a most serious legal problem will arise as to what is fair use, how far it extends, and whether it should acquire some definition or preferably some solution which would avoid the rigidity of definitions.

So, quite early in our activities, we discussed the possible solutions to the problem of usage of copyrighted materials for one purpose or another. May I say there are several ways such materials can be used? The obvious one is for profit. Of course, there are some copyrighted materials that are reproduced simply to save money, as in the case of schools where material is copied for use of students in classrooms, and which does save the purchase of textbooks or articles, maps, charts, and what not.

So saving and profit are in the same category, though there may be different motives in using one or the other.

Another way in which copyrighted materials are used is in my own field of science. I represent one field, geology, but I can speak both as an author and as a researcher. I can speak also as the former editor and publisher of two publications of the American Association for the Advancement of Science. One was a noncopyrighted weekly magazine, Science, the other was a copyrighted magazine, the Scientific Monthly, now discontinued.

I had no commercial interest whatever in these publications. But having published them does give me a breadth of experience in these matters which I think led to my election into this job, of president of the Committee To Investigate Copyright Problems.

As a scientist I can say that we use copyrighted material. We get copies of material for the advancement of science, our own particular interests in science to be sure, which at the same time, as a byproduct, promotes our reputations. In my own institution at the present time, the University of Pennsylvania, I find a fetish for publicaton. It means that, as chairman of the department of geology, I have to needle associates to keep busy and publish. And, of course, it means use of publications as a stepping stone to the advancement of their own particular fields.

Under these circumstances we felt that use for this nonmonetary purpose is just as important as use for profit, from the individuals point of view; and that, if the question of gain came up in discussing fair use, actually the scientist is using the material not merely as a reader. Our publications are for reading and we certainly encourage the widest possible reading, but most readers do not use the material in any particular monetary or reputational sense.

But then, when the materal is used other than for simple "reading" it occurs to me that I, as a scientist using my colleague's work, owe a debt; and this becomes all the more important because so many scientific publications are published not only at no profit but sometimes at a very serious monetary sacrifice.

Very few teachers in high schools or colleges can pay the full cost of the publications which they can profit by most. In most instances, the subscription prices to journals are relatively low. The journals are dependent upon outside income, such a taking in advertising, donations from commercial concerns, or advertisers and potential advertisers. In short, every device has been used, from the page charge to authors or to their sponsors, to advertising, in order to keep alive.

So our concern has been primarily with the job of keeping the creativity alive, and of course that is worthless unless it reaches an audience through publication.

We recognize that publication, as Mrs. Linden told you so vividly, has become far more than just the printed page. It has become the output of many very clever machines, ranging from computers to the Xerox which we use in our own department, and the question is, to what extent are these media being used for the reprinting or redistribution of copyright material ?

It is our feeling that they could be used a great deal more than they are. We had something to do with the inception of the Fry Associates study, and as Mrs. Linden pointed out, it was made in 1962 and a lot has happened since then in the explosion of reproduction devices.

We are convinced that the Fry study was grossly incorrect in one of its statements which I think I have before me. One of their statements claims that "there is no indication that the copyright law has served as a barrier to the dissemination of scientific and technical information.”

We contest this, because what we think Fry Associates did was to try to measure the flow of a faucet that was turned off. That is, the copyright law has slowed up a great many copying institutions, including public and university libraries, from copying material much more freely.

I can give you an instance. The Franklin Institute of Philadelphia arranged with a very large commercial research organization for the wire transmission of material from their very extensive and complete engineering and scientific library.

After the wire service was installed, they suddenly became worried about the copyright law and restricted the transmission of material to noncopyrighted works or old works in which the copyright had expired.

Here is an institution which would like instantaneous access to scientific and engineering materials in periodicals as well as in textbooks. It feels now that it must go through the delay of getting formal permission for the use of this material.

Where this kind of use is involved, we feel that to define fair use as being, shall we say, one to a customer, is really not fair at all because of the use to which the material may be put. "If the wire service concern transmits a single copy, the receiver can reproduce it at once on his own equipment, Xerox or otherwise, and distribute it to 50 people; that is, to the number of people engaged in the research for which this article would be pertinent.

For that reason, we came up with the thought-and I must say, some years before the witness this morning came up with it—of a clearinghouse for copyright material so that as many copies as are actually needed could be obtained for a reasonable fee. This idea has been

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under study by us for some years. We are now advanced to the point of designing the sampling system to be used by the clearinghouse. We are about to begin having a thorough study of this made by the Bureau of Social Science Research, to determine thereby a feasible method for dealing with the problem of use.

We are not committed to the idea. We want this dispassionate study made independently of our own organization before we reach any conclusion that this is the way of taxing the users via the reproducers, and transmitting the charge through, just as one finds the ASCAP organization doing in a somewhat similar situation. Through the electronic and other devices that are in use today, we find the department stores routing their billings to a concern that is well equipped to take care of the billings of many concerns, and we feel that the instrumentation is available for this kind of assaying:

But we are just at the brink of having this study made and of course we are a waiting its results before we reach any conclusions.

There is a great deal more to say but I promised to be short and these points, I think, were not covered this morning. However, I should be pleased to answer questions, and I know my two associates are smarter than I on some of these points, and would be glad to be questioned, too.

Mr. KASTENMEIER. Thank you, Professor Meyerhoff. Does your clearinghouse for copyright differ in any respect from Mrs. Linden's suggestion?

Mr. MEYERHOFF. Rather substantially, because it would be a clearinghouse for scientific as well as educational publishers, and it would be a focal point to take care of the contracts. Mrs. Linden suggested there would be individual contracts between the schools and individual publishers.

We feel again that that is a rather circuitous route and we feel that the clearinghouse could acquire contracts with all publishers. After all, the number is quite finite and for that reason it would be much simpler to deal with the contractual relationship through that kind of organization than it would by individual publishers with individual school systems.

Mr. KASTENMEIER. Do you testify really as a copyright holder, as a copyright user, or both?

Mr. MEYERHOFF. Both.

Mr. KASTENMEIER. Do you feel that your self-interest lies in one field more than another, say as an author more than a user?

Mr. MEYERHOFF. As a user much more than as an author, because so far I could hardly claim that I got tobacco money out of my royalties.

Mr. KASTENMEIER. Without having read your statement, does your statement attempt to analyze the different interests that are involved in the copyright revision and to assess which positions are preferable?

Mr. MEYERHOFF. I have read the law which I received, thanks to Mr. Kaminstein, and perhaps I should not make this statement, but so far as our thoughts are concerned it would not make much difference whether it is revised or not.

We feel that the concept in the law of 1909 is thoroughly sound, it allows latitude; and where we are fearful is only in the construction that might be put upon it if there were legal suits brought in by someone who felt that his copyright had been infringed, as he well might because of the new copying devices that are available.

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